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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?


To: stock bull who wrote (137789)7/27/1999 8:08:00 AM
From: GVTucker  Read Replies (1) | Respond to of 176387
 
stock bull, RE: I own stock in a company that did quit well this quarter. In their earnings statement, they noted that they are going to issue approximately 4 million shares, plus 2.5 million shares by selling stock holders. The 4 milion shares will be sold by the company. Am I correct is saying that the sale of these shares will not dilute the shares presently owned by the public investors?

Actually, the 2.5mm shares being sold by selling stockholders will not dilute the public's ownership; these shares have always been used when calculating earnings. The 4mm shares being offered by the company will indeed dilute existing shareholders, as these are new shares being issued.



To: stock bull who wrote (137789)7/27/1999 10:50:00 AM
From: Chuzzlewit  Read Replies (1) | Respond to of 176387
 
No, the additional 4 MM shares will dilute current shareholders. Let's take a simple example. Suppose you hold 1 share in a company that has issued 10 shares. Your stake is 10%. Now suppose the company plans on issuing an additional 10 shares. After issuance of the shares your stake will be reduced to 5%.

The ultimate sale of restricted shares does not dilute ownership, but it does add to the float.

TTFN,
CTC